It’s quite interesting knowing what’s Restructured Accelerated Power Development and Reform Programme (R-APDRP). Accelerated Power Development and Reform Programme (APDRP) got restructured in 2008 and a revised version was introduced, addressing the grave concern of high Aggregated Technical & Commercial (AT&C) Losses across DISCOMs. High AT&C losses basically resulted of poor political will to strengthen power infrastructure and entice the vote-bank on account of cheap (or free) electricity. Technical losses are attributed to improperly maintained equipment/systems, substations, distribution network, metering infrastructure and insufficient investment in infrastructure; and the commercial loss is on account of poor tariff policies, faulty meter reading, theft and pilferages.
Indeed it remained a tough task for the Utilities to execute the R-APDRP Projects. The Very impedance of knowledge barriers, technology availability, implementation guidelines, etc. played a critical role. Those who could digest the technology did well; and those who couldn’t be faced challenges for much longer than expected.
Indian IT companies (ITC, Infosys, Wipro, HCL, Accenture, etc.), power infrastructure companies (which were small and very distributed), meter manufacturers, telecom communication providers, and project management companies – remained key employers throughout.
R-APDRP Projects are divided into two parts, viz. Part-A and Part-B.
For the Preparation for the project areas having a population over 4 lacs and annual input energy of 350 MU, are considered for the application.
Power Finance Corporation (PFC) is the ‘Nodal Agency’ for the operationalization and implementation of the APDRP programme, under the overall guidance of the Ministry of Power (MoP).
Below are Project implementation modalities and the agencies signing to the quadripartite project agreement:
Project Funding Modalities
- 100% project cost is financed by GoI as a loan.
- The loan along with interest thereon shall be converted into a grant once the establishment of the required system is achieved and verified by an independent agency appointed by the Ministry of Power (MoP) through the Nodal Agency.
- No conversion to grant will be made in case projects are not completed within 3 years from the date of sanctioning of the project. In such cases, the concerned utility will have to bear the full loan and interest repayment. The project will be deemed to be completed on the establishment of the required system duly verified by an independent agency appointed by MoP through Nodal Agency.
- Initially, up to 25% funds for the projects shall be provided as a loan from the Government of India on such terms decided by the Ministry of Finance.
- The balance funds for Part B projects shall be raised from Financial Institutions (FIs), namely PFC/REC / multi-lateral institutions and/ or own resources.
- For Special Category States (all North-Eastern States, Sikkim, Uttarakhand, Himachal Pradesh and Jammu & Kashmir), GOI loan for Part B projects will be up to 90%.
- All other conditions/methodology applicable to non-special category states shall also be applicable to the special category states. The project-wise requirement of Gross Budgetary Support (GBS) will be decided by the Steering Committee.
- If the Distribution Utilities achieve the target of 15% AT&C loss on a sustained basis for a period of 5 years in the project area and the project is completed within the time schedule, up to 50% (90% for Special Category States) loan against Part-B projects will be convertible into a grant in equal tranches.
- If the utility fails to achieve or sustain the 15% AT&C loss target in a particular year, that year’s tranche of conversion of loan to grant will be reduced in proportion to the shortfall in achieving 15% Aggregate Technical & Commercial (AT&C) loss target from the starting base-line assessed figure.
- The loan from GOI shall be the first converted into a grant. Loans from FIs shall be converted into grant only after the conversion of full GOI loan into a grant.
MoP appoints a Third Party Independent Agencies (TPIEA) through by the Nodal Agency to verify below:
- Base figure for AT&C Losses
- The state power utility/distribution Company shall ring fence each identified project area at the beginning of the programme.
- Three billing cycle data of energy inflow and outflow and corresponding revenue collected for the project area shall be furnished to the Independent
- Agency for verifying the base (starting) figure of AT&C loss of the project area. Part B projects will be taken up after verification of initial AT&C loss by Ministry of Power (MoP) through the nodal agency.
- The establishment of Baseline Data System (i.e. completion of Part-A projects).
- Yearly AT&C loss figures of project areas and State Power Utilities / Distribution Companies.
In order to get APDRP Assistance, the State/Utility would require complying below:
- Constitute the State Electricity Regulatory Commission.
- Achieve the following target of AT&C loss reduction at the entire utility level every year starting one year after the year in which first project of Part-A is completed:
- Utilities having AT&C loss above 30%: Reduction by 3% per year
- Utilities having AT&C loss below 30%: Reduction by 1.5% per year
- commit a time frame for introduction of measures for better accountability at all levels in the project area;
- submit previous year’s (as of 31st March) AT&C loss figures of identified project area as verified by an independent agency appointed by Ministry of Power (MoP) / Nodal Agency by 30th June annually;
- The TPIEA would initially verify the input energy and corresponding cash collected for calculating AT&C losses. The following are the prerequisite to compute initial loss level and start Part-B schemes:
- All input points are identified and metered with downloadable meters for energy inflow accounting in scheme area.
- All outgoing feeders are to be metered in substation with downloadable meters.
- Scheme area should be ring-fenced i.e. export and import meters for energy accounting shall be ensured.
- Arrangement for measuring total energy flow in the rural load portion of the project area by ring-fencing, if the rural load feeder is not segregated.
- Devise a suitable incentive scheme for staff linking to achievements of 15% AT&C loss in the project area
Essentially it’s an agreement between four parties:
R-APDRP Projects brought a lot of changes in Indian Power Sector. In subsequent posts, we shall discuss on those as well.